Heavy buyings on Astra shares lift JSX index

Heavy buyings on Astra shares lift JSX index

Dow Jones, Jakarta

Indonesian shares ended higher on Wednesday led by foreign buying in automotive company Astra International ahead of its ex- dividend date on Thursday, dealers said.

They said foreign investors, who were active buyers, also bought shares in certain mining and infrastructure-related blue chips on expectations of improved earnings this year.

"Today's gains could reflect that foreign investors' underlying sentiment for Indonesian shares remains positive," said a fund manager with Paramitra Securities.

The positive sentiment is supported by the buoyant Indonesian economy, which the government expects to expand by 6 percent this year, compared with 5.4 percent in 2004.

The Jakarta Stock Exchange Composite index Wednesday ended up 1.2 percent, or 13.69 points, at 1,119.58 points.

Gainers led decliners 96 to 27, with 67 stocks unchanged. Volume was 1.87 billion shares valued at Rp 1.6 trillion, compared with 1.05 billion shares valued at Rp 912 billion on Tuesday.

Astra International jumped 4.8 percent to Rp 13,100 on the company's plan to pay a Rp 270 a share dividend and expectations of improved first-half earnings due to an increase in car and motorcycle sales.

Heavy equipment company Komatsu Indonesia rose 4.4 percent to Rp 4,175 and rival United Tractors ended 4.2 percent higher at Rp 3,700 on expectations of improved earnings this year due to higher sales of heavy equipment for infrastructure projects.

Also higher was Indonesian Satellite, which added 1.9 percent to Rp 5,500 on news it will issue up to $250 million worth of bonds to help finance its business expansion plan.

Profit-taking hit food maker Indofood Sukses Makmur, which dropped 2.5 percent to Rp 1,190 after gains in the previous four sessions.

Dealers said they expect the market to trade higher on follow- through buying in Astra International.

On the currency market, the rupiah closed slightly higher, likely on capital inflows into government bonds and the dollar's failure to make further gains versus major rivals, dealers said.

The dollar closed at Rp 9,605, down a tad from its close on Tuesday at Rp 9,609.

Dealers said they detected some inflows of funds, likely linked to the issuance of Rp 3.85 trillion of bonds by the government Tuesday, which were reported to have caught the interest of foreign investors.

Dealers said the dollar lost ground against the rupiah as it stalled against most major global currencies.

But, the dollar's slide was slowed by demand from state banks, who likely bought the unit on behalf of the state-owned oil company Pertamina, which is tasked to import petroleum products.

The current high price of oil globally is sustaining dollar demand from Pertamina.

Dealers said they expect the dollar to trade between Rp 9,580 and Rp 9,625 on Thursday.